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On February 5, the European Investment Bank (EIB) announced that it would provide financing of EUR1bn (US$1.1bn) towards the construction of the Trans-Anatolian natural gas pipeline (TANAP) later this year. TANAP is part of the Southern Gas Corridor, which will transit gas from Azerbaijan, through Georgia and Turkey to Europe. Gas is expected to reach Turkey via the pipeline in 2018, and European markets in 2020.

The EUR1bn financing will be allocated to a Turkish state-owned energy firm, BOTAS. According to a statement to the press from the EIB vice-president, Pim Van Ballekom, the World Bank will also provide a loan for the pipeline project. Analysts have suggested that the World Bank could provide financing of EUR1bn to BOTAS for TANAP. BOTAS currently holds a 30% stake in the project, and the Southern Gas Corridor Closed Joint Company (SGC, of which the State Oil Company of Azerbaijan holds a 49% share and the Azerbaijani state holds a 51% stake), has a 58% share in the TANAP project. BP (UK) holds the remaining 12% share.

The total cost of TANAP is estimated at around US$10bn-11bn. In January-September 2015 the State Oil Fund of the Republic of Azerbaijan (SOFAZ, the sovereign wealth fund) provided Manat489.3m (US$308.8m, at the current exchange rate) for TANAP.

SOFAZ will provide financing of Manat1.8bn (US$1.1bn) for TANAP this year, just under a quarter of the fund’s total spending plans.

On January 29th the Azerbaijani finance minister, Samir Sharifov, said that the SGC would launch a roadshow in February aimed at attracting US$2bn in financing for the project. Following the withdrawal of Total and Statoil from the project in December 2013, there has been more pressure on the existing shareholders to secure investment. The EU has provided limited support; in January 2016 it said that it would provide EUR2.22m to TANAP this year.http://www.ann.az